The cuts at Amazon exceed previous forecasts and represent about 5% of the company’s total corporate staff and 1.2% of the total number of employees (1.5 million people as of September 2022).
It’s also the largest cut in the current tech industry downturn, and the largest for the company in its entire history. (The company cut 1,500 jobs in 2001 during the dot-com crash, 15% of its workforce at the time. It also laid off several hundred corporate employees in early 2018, after another period of rapid expansion.)
In November, Amazon said it was beginning a wave of layoffs that would affect workers involved in device manufacturing, recruiting and retail operations. The Wall Street Journal reported that about 10,000 people would be laid off in total, and thousands had already left the company last year.
However, it has now become known that the total number of redundant workers will be 18,000 and they will be saying goodbye in the coming weeks. On Wednesday, Amazon CEO Andy Jessee commented on the cuts in a blog post:
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“Amazon has experienced uncertain and challenging economic conditions in the past and is expected to continue to do so.”
Jesse added that most of the layoffs will be in the retail and hiring industries, with workers notified of the cuts later in January.
Amazon’s revenue soared during the Covid-19 pandemic as people flocked to shop online. Rapid involvement in Amazon’s various businesses – from e-commerce to grocery stores and cloud computing – has fueled the company’s growth. To keep up with demand, Amazon doubled its logistics network and hired hundreds of thousands of employees.
As demand began to fall and customers returned to shopping as usual, Amazon initiated a major cost review. In the spring and summer, the company closed offline stores and business units such as Amazon Care. The company later stopped hiring new employees.
Many technology companies are following a similar path, due to the economic downturn. Amazon’s layoffs of more than 18,000 employees will be the biggest cut at a tech company in months, according to estimates published on Layoffs.fyi.
How tech companies are downsizing in 2022, Visual Capitalist infographic
Meta previously said it would cut more than 11,000 jobs, or 13% of its workforce. On Wednesday, the American company developer of the CRM system of the same name, Salesforce, announced that it was laying off 10% of its workforce. CEO Marc Benioff said they’ve hired a lot of people because profits soared at the start of the pandemic.
“I take responsibility for that,” Benioff added.
Source: WSJ
